By Suzanne Reimer, CMO Lotlinx
Hey dealers, are you leveraging automotive performance marketing?
You may ask why I am asking this question. After working in the automotive sector for four years and reviewing many dealers’ media plans, I have found that they are not separating their branded campaigns from their performance campaigns.
Defining Branded Campaigns
What do I mean by this? When you run branded campaigns, you are providing a narrative about your specific dealership at a broader level. Examples of this would be:
- What services you provide
- What sets your dealer apart
- Vision, mission, values
- Any events
- Philanthropic endeavors
Tactics used for branded advertising:
- Television commercials
- Banner ads
- Billboards
- Print campaigns
- Broad Social
Defining Performance Media
Performance marketing for dealerships is a results-driven approach to digital marketing. In this approach, the media is purchased based on when specific actions or outcomes are achieved. These actions include clicks, leads, sales, or other desired customer behaviors.
Examples of messaging in performance ads are:
- Focus on price point, features, and benefits of cars on your lot
- Create a sense of urgency
- Drive customers to specific VDPs directly (Vehicle Detail Page)
Tactics used for performance advertising:
- CPC campaigns
- Specific sub-brand/model social campaigns
- Affiliate marketing
- Programmatic network ads
Branded Campaigns vs. Performance Marketing
Here is a chart that summarizes the main differences:
Performance Advertising |
Brand Advertising |
|
Goal |
Drive ROAS (return on ad spend) |
Drive brand favorability |
Mechanism |
A reminder of the benefits and value prop. Drive specific outcomes |
Create an emotional connection between you and your target consumer |
Theory |
KPI-driven, shorter-term strategies |
Classic brand funnel; salience, memory structures |
Measurement |
Focused on behavior…digital conversions and sales |
Focused brand lift (improved awareness, brand equity, consideration, etc.) |
How |
Target consumers in the lower funnel of the shopper journey: when they are active and ready to buy |
Create awareness for your product or service to a broader audience |
Drivers |
Optimization of your clear goals is critical |
Creative and brand narratives matter most. |
Why is Separating Ad Spend Important?
In speaking with dealers, many do not separate their ad spend between branded and performance-based media. This is a critical step that should be taken. I recommend a dealer spend at least 70% of their advertising on moving inventory, as that is typically the priority.
Click here for more of Lotlinx’s dealership marketing ideas.
Identifying Performance-Based Media
How do you know you are running performance-based media? It is performance-based advertising when you have set a very specific measurable goal. Examples of these goals are:
- Drive clicks to specific VDP pages
- Drive sales of a specific model car
- Drive form fills for test drives
Key Benefits of Performance Marketing
- Higher ROI
- Targeted Ads
- Increased Traffic – Change to the right traffic
- Cost Efficiency
- Measurable Results
The Impact of Performance Marketing on ROI
To put the benefits of performance marketing into perspective, dealerships that strategically utilize performance marketing techniques tend to see substantial improvements in return on investment (ROI).
According to a recent study by McKinsey, companies report marketing efficiency gains of up to 30% and incremental top-line growth of up to 10% without increasing the marketing budget. Also, outcome-focused digital advertising campaigns that target specific actions like clicks and conversions have resulted in a notable increase in foot traffic and online engagements.
Optimizing Advertising Spend with Vin View Optimizer
It is very important to understand where your media dollars are being spent. The more you can optimize against sales, the more profitable you will be.
At Lotlinx, we have a report called the Vin View Optimizer (VVO). This report breaks down each paid and organic channel and identifies how each VIN is being promoted individually. It flags inventory that is at risk and inventory that is oversaturated. Identify inventory risk, optimize advertising spend, and inspect your digital performance – with 100% visibility.
About the Author
Suzanne Reimer is the chief marketing officer at Lotlinx. She brings more than 20 years of experience to lead the organization’s branding, strategy and marketing plan development. With extensive experience in all aspects of business-to-consumer and business-to-business marketing, Reimer possesses superior skills for digital transformation. Before joining Lotlinx, she was the first marketing hire at Automotive Mastermind, helping triple business in her first year and supporting the organization through its acquisition by IHS Markit in 2017. Reimer has held leadership roles with MS3 Marketing, Arc Worldwide, and various small businesses and start-ups. She also worked for companies including Campbell Soup Company, Church & Dwight, Bristol-Myers, Unilever, and AT&T Wireless.